Czech National Bank Governor "Including 2.5% of reserves in BTC ETF could greatly improve returns"
Summary
- Aleš Michl, Governor of the Czech National Bank, said that allocating about 2.5% of reserves to a Bitcoin (BTC) ETF could improve returns.
- Michl said that BTC ETF inclusion provides an expected return similar to increasing the U.S. stock allocation from 38% to 50%, and that the additional volatility is lower.
- He said that if 5% of reserves had been allocated to BTC over the past 10 years, the annual average return would have risen by 3.5 percentage points, but portfolio volatility would have almost doubled.
An analysis has been raised that if Bitcoin (BTC) exchange-traded funds (ETFs) were slightly included in the management of foreign exchange reserves, one could expect an improvement in returns similar to significantly increasing the equity allocation.
On the 1st (local time), according to crypto-asset specialist media UBlockchain, Aleš Michl, Governor of the Czech National Bank, said, "If about 2.5% of reserves were allocated to a Bitcoin ETF, you could obtain an expected return similar to expanding the U.S. stock allocation from 38% to 50%," adding, "and the additional volatility is less."
He went on to explain, "If 5% of reserves had been allocated to BTC over the past 10 years, the annual average return would have been about 3.5% percentage points higher," but "overall portfolio volatility would have nearly doubled."
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
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